August 31, 2011

This is a guest post by Mr. Sanjay Vijayaraghavan – who has been an Office Bearer in a 500 Unit Apartment Complex, which has successfully registered under the Karnataka Apartment Owners Act recently. Mr. Sanjay is one of the ADDA users who champion the cause for a more effective Legal Framework for Registration and Governance of Apartment Owners Associations.

The Karnataka Apartment Ownership Act – Improve the Law and Implement It

As residents of any apartment complex in Bangalore and the state of Karnataka will agree, community living has its challenges. The managing committees of various apartments valiantly fight everyday to solve problems, evolve consensus and improve the life of the residents. In most new apartments sold, it is common to see a debate on registering the association and the right law to register under. Many lawyers nowadays advice registering under the societies act. However, a quick perusal of the law will make clear that the Karnataka Apartment Ownership Act of 1972 is the correct law to register under.

There are two acts that govern apartment related legalities and affairs in the state of Karnataka. One is the Karnataka Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1972, also known as Act No. 16 of 1973. The other law is the Karnataka Apartment Ownership Act (KAOA), 1972, otherwise called Act no 17 of 1973. Act 16 of 1973, as the full title suggests, governs the builder and promoter. With respect to apartment governance, the act actually requires the builder/promoter to clearly define the nature of the organization of flat owners that is envisaged for a particular project right at the beginning, in writing. Act 16 also requires the builder to form such an association as soon as possible by registering such association with the competent authority. The act also includes a timeline for the transfer of title deeds and related documents of the undivided property to this association so formed. The KAOA on the other hand deals with apartments as heritable property as well as the rules and regulations for running an apartment association. While the KAOA is probably less detailed compared to what exists in states such as Maharashtra, it certainly sets up a reasonable framework to work with.
However, these laws are beset with problems of poor implementation and enforcement. For example, there is no authority specified under KAOA to ‘register’ an association, though the ‘Registrar of Co-operative Societies’ has been named as the “Competent Authority”, but with powers and responsibilities not clearly defined. Because of this and many other lacunae in the KAOA, many unscrupulous builders have been exploiting the situation by retaining ownership and control over common areas and assets, putting the owners to various kinds of hardships.

What is even more galling is that the government of Karnataka for a while was not sure which department was responsible for implementing these laws. Finally an RTI application followed up by a case before the Karnataka Information Commission Case No KIC 3658 PTN 2009 brought out that the Urban Development Department is the responsible department.

It is time for a serious look at these laws and to improve them based on best practices around the country. It is also important for these same laws to be properly implemented. With the rapid expansion of apartments in Bangalore and Karnataka, it is essential to fix these laws for the peace of mind of apartment buyers and peaceful and happy living in these communities.

An improved legal framework for Apartment Communities has become an immediate necessity. What is your Opinion?

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KAOA 72is the only act under which multi storied Apartments complex owners Society can be registered. This is so because there is an imperative need for common areas and facilities should be legally managed. All those who own the flats also own their undivided common area and facilities in ratio of their contribution.Only this act give the owners the property rights over common areas and facilities and these rights are conveyed when the flats are conveyed to the owners by the Builder. Many a Builder register the Society under Societies act because they do not want to legally hand over control of common areas and facilities to the owners. By forming a Society under KOAOA 72 the owners of Flats authorise an elected body (BOM) to manage these common areas. Hence there is no legal ambiguity in ownership and management of Common areas and facilities.

Jal Vayu Vihar Apartment Owners Assn has been trying to register an assn under KAOA Act and Registrar of Societies has not issued a cert of regn even after a lapse of 10 years . We have complied with all the requirements under the act; but Reg of Societies feels that he has not been empowered.

Does this article mean that Reg of Soc has started issuing regn cert. or is it Urban Dev Dept which will do it?